BGR Says Regional Authority Best Path to Cooperation on Airport DevelopmentFor Immediate Release – June 9,, 1999
Contact: Mary Anne Barton, Acting President & CEO
(504) 525-4152, ext. 12
The citizens of New Orleans have much to gain and little to lose by allowing transfer of control over New Orleans International Airport from the City of New Orleans to a new regional authority, the Bureau of Governmental Research (BGR) says in a report released today.
BGR’s analysis of obstacles and paths to needed expansion and development of the Airport is contained in a report entitled "New Orleans International Airport: Governance, Regional Cooperation and Airport Expansion."
"The continued economic viability of the New Orleans region depends on the availability of a first-class airport, with good access, adequate capacity, and reliable service," emphasized Dr. George H. Porter, III, BGR Chairman of the Board. "The eight parishes in the airport’s primary service area account for almost one-third of the state’s population," he added. "What is a regional airport in fact should become regional in legal authority, and what is an international airport in name should become a world-class airport in fact," he declared at BGR’s news conference.
BGR surveyed the governance structures of nearly 50 airports and examined more closely 14 airports with regional issues similar to those confronting New Orleans International. While the geopolitical problems faced by NOIA—an airport situated in one political jurisdiction, needing to expand into another, and controlled by yet a third—have proved daunting, they are not unique to New Orleans, pointed out Mary Anne Barton, Acting President and CEO of BGR. "The way around the obstacles is through painstaking negotiation of intergovernmental agreements that address the specific issues and interests of the parties involved," Barton said at today’s news conference.
BGR researcher and writer Janet Howard examined a number of strategies used elsewhere for addressing regional expansion needs of airports, including:
^ Geographic representation on airport boards;
^ Specific noise reduction programs;
^ Master planning;
^ Metropolitan Planning Commissions and Growth Management Plans, and
^ Redistribution of authority over zoning and the power of eminent domain.
Improved noise reduction and partial geographic representation on the airport board are strategies currently in use for NOIA.
Strategies for NOIA discussed in past years have included a state buy-out of the Airport and a new regional airport. Because of Federal Aviation Administration interpretation of revenue diversion rules applicable to the Airport, the City could not profit from sale or lease of the airport to the State or any other entity. Such proceeds must be reinvested in airport operations. Even with a transfer of airport authority to a regional body, though, the City could continue to hold title to airport land and improvements in case FAA interpretation of the rules changes.
Because of the rules on use of airport revenues, the Airport is not now and cannot be turned into a revenue-generating asset for the City of New Orleans, the BGR report points out. In addition, the City’s capital investment in the airport is dwarfed by that of the state and federal governments. The City does receive approximately $1.2 million annually as reimbursement of costs incurred in running the Airport.
Given federal airport infrastructure funding constraints and priorities, current efforts to secure financing for the construction of a new regional airport—at least in Louisiana—are unlikely to succeed. BGR concludes that the economic interests of the region should not be held hostage by unrealistic expectations; further delays in addressing New Orleans International’s pressing expansion and development needs will have profound economic consequences. Federal funding allocated to airport infrastructure projects is already only about one-fifth of current estimated need, according to the American Association of Airport Executives. NOIA simply does not have the usage and congestion that put it high on the list for federal airport funding. The only new airport that has opened since 1976 was Denver International in 1995. At least 31 other airports are expected to have greater aircraft delays than New Orleans in 2006.
BGR recommends creation of a regional governance structure for the airport on the basis that such a structure could:
^ facilitate the formation of a broad-based, public-private alliance to promote the Airport at state and federal, as well as local, levels;
^ help create a broader base of legislative support;
^ provide a broader base for financing; and
^ provide a more appropriate framework for planning, immediately involving all the jurisdictions affected by airport expansion.
In addition to creation of a broad-based regional airport authority, BGR recommends serious and immediate consideration of private airport management.
BGR also recommends that the City of New Orleans retain title to the airport’s existing land and facilities and lease them to the new authority, so the City could benefit from the sale or lease of the airport’s assets if such payments become legally allowable in the future.
BGR further recommends abandoning the concept of a major, new airport as a solution to the region’s near- and intermediate-term airport needs.
The City of New Orleans, Kenner, and St. Charles Parish should begin now to develop a detailed regional intergovernmental agreement addressing all the issues that need to be resolved if the Airport is to expand in accordance with its plans. "Detailed discussion of these issues is imperative whatever course of action is finally decided upon," Barton stated.
See the attached sheet of "Recommendations" for a complete summary of BGR’s recommendations for airport governance and responsiveness to citizens.
The BGR Review Committee for the report was chaired by BGR Secretary Ralph Miller. Serving with Miller on the committee were W. Anderson Baker III, David Guidry, Anne M. Milling, Sharon A. Perlis, and George H. Porter, III, ex officio. Principal researcher and writer of the report was Janet Howard.
The New Orleans Business Council, the Jefferson Business Council, and the New Orleans Regional Chamber of Commerce helped fund BGR’s airport study.
BGR is a private, nonpartisan, nonprofit citizen-supported research organization founded in 1932 and dedicated to informed public policy-making and the effective use of public resources in the New Orleans metropolitan area.
RECOMMENDATIONS
BGR believes that the establishment of a regional authority is the optimal solution to
southeastern Louisiana’s airport issues and that steps should be taken immediately to
accomplish this objective.
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